Cheque Truncation System (CTS) in India- An Introduction & FAQs
PROCESS FLOW OF CHEQUE TRUNCATION
It is also possible for cheque issuers to consider newer techniques such as embedded
verifiable features such as bar-codes or logos or watermarks, encrypted codes,
holograms, etc., which would facilitate early interception of altered/forged instruments.
In order to ensure only images of
requisite quality reach the drawee branches, there will be a quality check process at the
level of the Capture Systems and the Clearing House Interface. This would ensure only
images of requisite quality secured with the digital signatures of the presenting banks
reach the drawee branches. In addition, drawers could consider using holograms, barcoding
or such other features, which would add to the uniqueness of the images.
In the CTS the presenting bank will capture the data & images of the
cheques using their Capture System which is internal to them. They have to meet the
specifications and standards prescribed for data and images. To ensure security, safety
and non-repudiation the PKI (Public Key Infrastructure) is being implemented across the
system. The banks will send the captured images and data to the central clearing house
for onward transmission to the payee/drawee banks. For that purpose RBI will be
providing the banks software called the Clearing House Interface (CHI) that will enable
them to connect and transmit data in a secure way and with non-repudiation to the
Clearing House (CH).
The Clearing House will process the data and arrive at the
settlement figure for the banks and send the required data to payee/drawee banks for
processing at their end. The drawee/payee banks will use the same CHI mentioned
earlier for receiving the data and images from the Clearing House. It will be the
responsibility of the drawee bank Capture System to process the inward data and
images and generate the return file for unpaid instruments.
Under CTS, after the capture of the image, the physical cheque would be warehoused
with the presenting bank. In case the beneficiary or any other connected persons require
the instrument, the payee bank could issue a copy of the image, under its authentication,
which is called Image Replacement document. It is a legally recognized replacement of
the original cheque for re-presentment. The provisions of NI act (Section 81(3) of the NI
Act as amended) also permit the usage of such IRD.
The infrastructure required for CTS from bank?s end are connectivity from the bank
gateway to the clearing house, hardware and software for the CTS applications.
RBI shall be providing member banks with the CHI and the banks have to procure other
hardware and system software for the CHI and the application software for their capture
systems on their own.
The hardware requirement is based on the volume of the cheques processed by the
banks. Based on the volume the CHI is categorized into four types and the hardware
requirement is different for each category.
The band width requirement for each bank is calculated based a number of factors like
the peak inward and outward volume of the bank, average size of an image, efficiency
factor of the network etc. In addition to that future requirement have been taken into
consideration for calculating the band with requirement.
Imaging of cheques can be based on various technology options. The cheque images
can be black and white, Grey Scale or coloured. Black and White images do not reveal
all the subtle features that are there in the cheques. Coloured Images increase storage
and network bandwidth requirements. So it was decided that the electronic images of
truncated cheques will be in gray scale technology. There will be three images of the
cheques i.e. front grey, front black & white and back black & white which will be made
available to member banks. The image specifications are:
Image Type Minimum DPI Format Compression
Front GrayScale 100 DPI JFIF JPEG
Front Black & White 200 DPI TIFF CCITT G4
Reverse Black & White 200 DPI TIFF CCITT G4
The image quality of the Grey Scale image shall be 8 bits/pixel (256 levels).
Scanners also function like photo-copiers by reflecting the light passed through narrow
passage on to the document. Tiny sensors measure the reflection from each point along
the strip of light. Reflectance measurements of each dot is called pixel. Images are
classified as black and white, gray-scale or colour based on hoe the pixels are converted
into digital values. For getting a gray scale image the pixels are mapped onto a range of
gray shades between black and white. The entire image of the original document gets
mapped as some shade of gray, lighter or darker, depending on the colour of the source.
In the case of black and white images, such mapping is made only to two colours based
on the range of values of contrasts. A black and white image is also called a binary
INTRODUCTION;WHAT IS CHEQUE TRUNCATION; CRITERIA OF MEMBERSHIP... Click here
HOW CTS WORKS FOR BANK CUSTOMER;BENEFIT TO BANK CUSTOMERS... Click here
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